Performance Management

1. Human Resource ManagementAngelo S. DeNisi &Ricky W. Griffin Performance Management CHAPTER 8 PowerPoint Slides by Charlie Cook

2. Performance appraisal is the specific and formal evaluation of an employee in order to determine the degree to which the employeeis performing his orher job effectively. Performance management is the general set of activities carried out by the organization to change (improve) employee performance. Performance Appraisal

3. Why Organizations Conduct Performance Appraisals Importance and goals of performance appraisal Provides a benchmark for recruiting and selection processes Identifies training needs and verifies training effectiveness Provides guidance in structuring compensation and rewards Documents the merit basis of organization’s selection process Gives feedback for motivating and developing employees Provides information for use in human resource planning

4. Establishjob duties Establish and communicate performance standards Additional feedback, coaching or counseling may be utilized Inspect/observeperformance Implement performance improvement plans Document/recordobserved performance Rateperformance Has Performance Improved? Set up meetingwith employee No Provide feedback, coaching or counseling as needed Transfer/demote/terminate employee A Typical Performance Management Process Is Performance Improving? Yes Recognize/reward performance, foster furtherdevelopment No Performancemanaged(repeat performance cycle) Yes

5. Sources of Information for Performance Appraisal Supervisor Peers The Ratee Self-appraisal Customers Subordinates

6. Roles in the Performance Appraisal Process The organization’s role is to develop the general appraisal process and define its purposes (development and compensation), frequency, performance standards, and the use of appraisal results. The role of raters in the appraisal process is to assist in the development of performance standards, collect information, communicate the appraisal results, and engage in performance management. Ratees must have access to performance appraisal information in order to develop clear and unbiased views of their work performance and be receptive to changing their behaviors.

7. 3600 Performance Appraisal Supervisor Team Peers Self Customers Subordinates

8. Ranking Methods Simpleranking The manager ranks from top to bottom or best to worst each member of a particular work group. Paired- comparison The manager compares each employee with every other employee, one at a time. The manager groups employees into predefinedfrequencies of performance ratings. Forced-distribution

9. Rating Methods Graphic rating scale The manager selects a point on a scale that consists of a statement or question about some aspect of an individual’s performance. Critical-incident Managers are required to recall, or consult a log of, instances of good or bad employee performance when evaluating performance and giving feedback. BARS are a combination of graphic rating scales and the critical-incident method that define various dimensions of performance. The scales place work behaviors in a hierarchy of importance. Behaviorally Anchored Rating Scales

10. Rating Methods A BOS is developed from critical incidents, like BARS, but uses more critical incidents to define effective performance measures and to indicate their frequency of occurrence. Behavioral Observation Scale A goal-based appraisal system that focuses on collective goal setting by subordinates and their managers. Goals are periodically reviewed for progress and attainment. Management by Objectives

11. Examples of Graphic Rating Scales Please rate the target subordinate on the following characteristics: Attitude 1 2 3 4 5 Poor BelowAverage Average AboveAverage Outstanding Working with Others 1 2 3 4 5 6 7 Poor Average Outstanding Meeting Deadlines ____ Needs improvement ____ Meets expectations ____ Exceeds expectations Quality of Work Poor Outstanding

12. Deficiencies and Weaknesses of Performance Appraisals Projection The tendency to see in others characteristics that we have, which we think contribute to effectiveness. Contrasterror An error that occurs when comparing people against one another rather than to an objective standard. An errors of severity, leniency, or central tendency made when a rater uses only one part of the scale. Distribu-tional error One positive performance characteristic causes the manager to rate all performance aspects positively. Haloerror A manager downgrades all performance because of a single negatively viewed performance dimension. Hornserror

13. Behaviorally Anchored Rating Scales Performance Dimension 1. Interpersonal skills: Instructor’s ability to establish rapport with students in and out of the classroom. 7 Instructor encourages students to ask questions. 6 Instructor comes down to level of students.Instructor maintains an informal relationship with the students 5 4 Instructor doesn’t draw out students who don’t ask questions. 3 2 Instructor “puts down” students who ask questions.Instructor lowers students’ self-esteem. 1

14. Goals review Feedback Management by Objectives (MBO) Supervisor Subordinate Collectively set goals Periodic review Annual review

15. Performance Management and Providing Feedback Improving the performance feedback interview Provide timely and ongoing feedback to employees. Have individuals appraise their own performance. Encourage participation and two-way communication. Balance negative and postive feedback during the interview. Maintain a developmental and problem-solving orientation. Set clear and specific goals for improving performance.